## Facts

- The Gulf sturgeon, a threatened anadromous fish species, was listed under the Endangered Species Act (ESA) in 1991.
- The ESA generally requires designation of a listed species’ “critical habitat” at the time of listing, subject to limited statutory exceptions and timing extensions.
- After permitted one-year extensions, the responsible agencies still did not designate critical habitat for the Gulf sturgeon by the deadline.
- In separate litigation, a district court ordered the Department of the Interior to take appropriate action concerning critical habitat, prompting the agencies to issue a formal decision.
- In 1995, the U.S. Fish and Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) decided critical habitat designation was “not prudent,” reasoning it would provide little or no additional protection.
- That conclusion depended on regulatory definitions in 50 C.F.R. § 402.02 that tied both “jeopardy” and “destruction or adverse modification” to impacts on “both the survival and recovery” of a species.
- Under the agencies’ approach, actions impairing recovery (but not survival) could avoid triggering consultation duties, and critical habitat designation was treated as largely duplicative of existing “jeopardy” protections.
- Sierra Club sued under the Administrative Procedure Act (APA), arguing the “not prudent” decision was arbitrary and capricious because it rested on an invalid regulation; the district court granted summary judgment to the agencies.

## Issues

1. Whether FWS and NMFS acted arbitrarily and capriciously under the APA by refusing to designate critical habitat for the Gulf sturgeon based on the premise that designation would provide no additional benefit beyond ESA “jeopardy” protections.
2. Whether 50 C.F.R. § 402.02 impermissibly narrowed the ESA by defining “destruction or adverse modification” and “jeopardize the continued existence” to require harm to both survival and recovery.

## Decision

- The Fifth Circuit reversed the district court’s summary judgment for the agencies.
- The court held the refusal to designate critical habitat was arbitrary and capricious because it relied on an impermissible regulatory definition in 50 C.F.R. § 402.02.
- The court rejected the regulation’s “both survival and recovery” limitation as inconsistent with the ESA’s structure and purposes, including recovery as a distinct statutory objective.
- The case was remanded for further proceedings consistent with the court’s opinion.

## Legal Principles

- Under the APA, agency action must be set aside if it is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.
- The ESA protects more than bare survival; statutory conservation goals include recovery, and regulatory interpretations cannot collapse distinct ESA standards into a single, overly narrow test.
- A regulatory definition that triggers consultation only when an action reduces both survival and recovery unlawfully permits actions that significantly impair recovery to escape scrutiny.
- Agencies may not treat critical habitat designation as superfluous by relying on an interpretation that makes “adverse modification” protection duplicative of “jeopardy” protection.

## Conclusion

The Fifth Circuit invalidated the agencies’ no-benefit rationale for declining to designate critical habitat for the Gulf sturgeon because it rested on a regulation that improperly narrowed ESA protections to actions affecting both survival and recovery, rendering the “not prudent” decision arbitrary and capricious under the APA.


Sierra Club v. U.S. Fish & Wildlife Serv., 245 F.3d 434 (5th Cir. 2001)